Translation
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any
discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results
for the Three Months Ended June 30, 2018
(Based on Japanese GAAP)
August 10, 2018
Company name:

Digital Garage, Inc.

Stock exchange listing: Tokyo
Stock code:
4819
Representative:

Inquiries:

URL

https://www.garage.co.jp/

Representative Director,
Kaoru Hayashi
President Executive Officer and Group CEO
Member, Board of Directors, Senior
Executive Officer, in charge of the Corporate Makoto Soda

TEL

Strategy Division
Scheduled date to file Quarterly Securities Report:

August 13, 2018

Scheduled date to commence dividend payments:
Preparation of supplementary material on quarterly financial results:–Yes

Holding of quarterly financial results meeting:No03-6367-1111(Amounts less than one million yen are rounded down)
1. Consolidated financial results for the three months ended June 30, 2018 (from April 1, 2018 to June 30, 2018)(1) Consolidated operating results (cumulative)
Net salesThree months ended June 30, 2018
Three months ended June 30, 2017

Millions of yen
15,335
13,103

Percentages indicate year-on-year changes
Profit attributable toOperating profit
Ordinary profit
owners of parent% Millions of yen% Millions of yen% Millions of yen
%
17.0
852
83.5
1,572
41.5
1,887
49.0
–
464
–
1,111–
1,267–

Earnings per share

Diluted earnings per share

Yen
40.00
26.90

Three months ended June 30, 2018
Three months ended June 30, 2017

Yen
39.61
26.75

(2) Consolidated financial position
Total assets
As of June 30, 2018As of March 31, 2018

Net assets

Millions of yen
111,275
108,596

Equity ratio

Millions of yen
40,57739,017

%
35.3
34.8

2. Cash dividends
Annual dividends per share

Year ended March 31, 2018Year ending March 31, 2019

1st quarter-end

2nd quarter-end

3rd quarter-end

Fiscal year-end

Yen––

Yen
0.00

Yen–

Yen
24.00

Yen
24.00

0.00

–

28.00

28.00

Year ending March 31, 2019 (Forecast)Total

3. Forecast of consolidated financial results for the year ending March 31, 2019 (IFRS) (from April 1, 2018 to March 31, 2019)
Percentages indicate year-on-year changes
Profit attributable toRevenue
Profit before tax
Earnings per shareowners of parent
Millions of yen% Millions of yen% Millions of yen%Yen
Full year
33,500–9,000–
6,200–
131.49
Digital Garage, Inc. plans to apply IFRS from the end of fiscal year ended March 31, 2019. The above forecast is based on IFRS. There is noyear-on-year comparison given that the forecast is IFRS based.

14. Notes(1) Changes in significant subsidiaries during the three months ended June 30, 2018(changes in specified subsidiaries resulting in the change in scope of consolidation):No(2) Application of special accounting methods for preparing quarterly consolidated financial statements:

No(3) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements
Changes in accounting policies due to revisions to accounting standards and other regulations:
Changes in accounting policies due to other reasons:

No
No

Changes in accounting estimates:
Restatement of prior period financial statements:

NoNo(4) Number of issued shares (common shares)
Total number of issued shares at the end of the period (including treasury shares)
As of June 30, 2018

47,323,800 shares As of March 31, 2018

47,312,800 shares

Number of treasury shares at the end of the period
As of June 30, 2018

123,852 shares As of March 31, 2018

123,821 shares

Average number of shares during the period (cumulative from the beginning of the fiscal year)
Three months ended June 30, 201847,194,466 shares Three months ended June 30, 20172

47,105,895 shares

Quarterly consolidated financial statements
Consolidated balance sheets(Millions of yen)
As of March 31, 2018

As of June 30, 2018

AssetsCurrent assets
Cash and deposits

32,922

29,113

Money held in trust
Notes and accounts receivable - trade

5,307
7,741

4,054
9,295

Operational investment securities
Allowance for investment loss

12,364(1,235)

13,622(1,230)

269
221

319
235

8
16,88911
19,150

718
(32)

680
(46)

75,17675,205MerchandiseWork in process
Raw materials and supplies
Accounts receivable - other
Other
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment

2,338

2,539

Intangible assets
Software

2,019

2,077

GoodwillOther

7,822
28

7,656
28

Total intangible assets

9,869

9,761

Investments and other assets
Investment securities

16,552

18,812

Other
Allowance for doubtful accounts

4,691
(31)

4,988
(31)

Total investments and other assets

21,211

23,768

Total fixed assets
Total assets

3

33,41936,069108,596111,275

(Millions of yen)
As of March 31, 2018

As of June 30, 2018

Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term loans payable

5,018
1,700

6,286
7,200

Current portion of long-term loans payable
Income taxes payable

2,437
1,008

2,530
1,023

Provision for bonuses
Deposits received

291
36,499130
29,663

Other

2,339

2,849

Total current liabilities

49,294

49,68318,890–18,891
391

Fixed liabilities
Long-term loans payable
Net defined benefit liability
Other

1,394

1,731

Total fixed liabilities

20,28421,01469,57870,698

Capital stock
Capital surplus

7,464
3,104

7,478
3,106

Retained earnings
Treasury shares

25,819(26)

26,574(26)

Total shareholders' equity

36,36337,133

Total liabilities
Net assetsShareholders' equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

339

971

Foreign currency translation adjustment

1,100

1,223

Total accumulated other comprehensive income

1,440

2,194

844842

Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

4369

407

39,017

40,577

108,596111,275

Consolidated statements of income (cumulative) and consolidated statements of comprehensive income(cumulative)
Consolidated statements of income (cumulative)(Millions of yen)Three months ended

Three months ended

June 30, 2017

June 30, 2018

Net sales
Cost of sales

13,103
10,595

15,335
11,848Gross profit

2,507

3,487

Selling, general and administrative expenses

2,043

2,635

464

852

Interest income
Share of profit of entities accounted for using equity method

3615

18587

Other

129

230

Total non-operating income

748

836

2063

2265

Operating profit
Non-operating income

Non-operating expenses
Interest expenses
Rent cost of real estate
Other

1728

Total non-operating expenses

101115

1,111

1,572

130

717
––
1,388

Ordinary profitExtraordinary income
Gain on change in equity
Gain on sales of investment securities
Gain on sales of shares of subsidiaries and associates
Other

084

719

1,503

Loss on retirement of non-current assets
Loss on step acquisitions

–
–

035

Total extraordinary losses–

35

Profit before income taxes

1,830

3,039

Income taxes - current
Income taxes - deferred

595
(27)

1,128
45

Total income taxes

568

1,173

1,261

1,866

(5)

(21)

1,267

1,887

Total extraordinary income
Extraordinary losses

ProfitLoss attributable to non-controlling interests
Profit attributable to owners of parent

5Consolidated statements of comprehensive income (cumulative)(Millions of yen)

ProfitOther comprehensive income

Three months ended

Three months ended

June 30, 2017

June 30, 2018
1,261

1,866

Valuation difference on available-for-sale securities
Foreign currency translation adjustment

(29)
13594
122

Share of other comprehensive income of entities accounted
for using equity method

2938

Total other comprehensive income

12755

1,274

2,621

1,278

2,642

(4)

(20)

Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

6